Mike Cavanagh is no longer next in line at JPMorgan, after leaving to join The Carlyle Group. Don't be so surprised.
FORTUNE — Private equity firm The Carlyle Group CG stunned Wall Street this morning, by announcing that it had poached Michael Cavanagh, the man many believed to be Jamie Dimon’s heir apparent at JPMorgan Chase & Co. JPM .
Cavanagh will serve as co-president at Carlyle, a newly-created role he will share with Carlyle’s existing chief operating officer Glenn Youngkin (the pair also will share COO duties). At JPMorgan, he had been co-CEO of corporate and investment banking.
Some quick notes:
1. Carlyle launched a search for this position more than six months ago, in part to help lessen the load on Youngkin, whose management responsibilities spanned such things as investments, strategy and new products. The deal with Cavanagh came together within the past couple of weeks, as evidenced by the fact that he spoke at JPMorgan’s investor day just one month ago (Feb. 25). Had JPMorgan known Cavanagh was leaving, it’s highly unlikely he would have been given such a high-profile role in that event.
2. There seems to be a lot of Twitter consternation as to why someone so close to the JPMorgan throne would leave to serve in a secondary position at Carlyle (particularly when there is no indication that the firm’s ruling triumvirate plans to retire). But such surprise… well, surprises me. For starters, there’s a good chance that Cavanagh actually will make more at Carlyle than he did at the bank. We’ll know for for once the 8-K is filed, but here is a bit of context: Youngkin last year received around $10.56 million in total comp. Most of that was carried interest and other investment performance fees that a newcomer would not necessarily be entitled to, but it also included a $225,000 base salary and a cash bonus in excess of $2 million.
Moreover, there are fewer regulatory headaches at a private equity firm than at a Wall Street bank — not to mention fewer Congressional hearings (Cavanagh didn’t get rave reviews for his performance last March at a Senate hearing on the London Whale). Finally, private equity has better job security than does banking (Dimon’s abnormally-long tenure notwithstanding).
3. It is a bit interesting that Carlyle is creating the president (or co-president) position, just as Apollo Management Group is getting rid of theirs (following Marc Spilker’s resignation). My understanding of the Apollo move was that the president role was largely to help get the firm ready to go public, and deal with its transition into a listed company. At this point, there wasn’t all that much to do. Carlyle obviously views things differently.
Sign up for Dan Primack’s daily email newsletter on deals and deal-makers: GetTermSheet.com